Entrepreneur Built Multi-Million Dollar Business by Embracing Debt
Christine Slocumb, entrepreneur and advisor, details how her initial reluctance to borrow for her business led to its eventual sale for a multi-million dollar exit.
Christine Slocumb, an entrepreneur and advisor, outlines her journey with business financing in an article for Inc. Magazine. Initially hesitant to take on debt, Slocumb eventually recognized the strategic value of leveraging external capital for business growth and profitability.
Slocumb suggests many founders approach business debt with more trepidation than personal loans, despite it being secured by business cash flow rather than personal income. She notes that financial institutions conduct thorough due diligence, mitigating risk for businesses with sound financial records and positive cash flow history.
The article details three common forms of external financing: lines of credit and bridge loans to manage cash flow fluctuations, and growth loans for significant expansion initiatives like acquisitions or platform development.
Ultimately, Slocumb points to selling the business to buyers backed by investors or private equity as the apex of using other people's money, capitalizing on the future cash flow potential built into the company.